Bought A Car Above Rs 10 Lakh? How To Check If Your TCS Was Recorded

Many car buyers do not realise that the moment the price of a vehicle crosses Rs 10 lakh, an extra tax gets added under the Income Tax Act. This amount, known as Tax Collected at Source (TCS), has to be

collected by the seller right at the time of purchase. It applies to cars of all kinds, and the law does not treat new, old or imported vehicles differently.

Under Section 206C(1F), the seller must collect TCS at 1 per cent of the value of any car priced above Rs 10 lakh. So if someone buys a vehicle worth Rs 12 lakh, the dealer has to collect Rs 12,000 as TCS. This system helps the government keep track of high-value purchases and ensures the buyer’s details are properly recorded to reduce the chances of tax evasion.

Why The Tax Is Collected And How It Is Used

The basic idea behind TCS is simple: the government wants a clear record of large transactions. Since cars in this range involve significant amounts, collecting a small tax upfront helps create a trail of the buyer’s PAN and the payment made. The dealer then deposits this 1 per cent with the government.

Investment advisor Ashish Kumar Meher recently pointed out that this TCS amount is not lost money. Buyers can claim it back as a refund when filing their Income Tax Returns (ITRs). Once the dealer deducts TCS, they issue a certificate called Form 27D, which acts as proof of the tax collected.

How To Check If Your TCS Is Recorded

Buyers are advised to download Form 26AS from the Income Tax Department’s e-filing portal. This is an annual tax statement linked to your PAN, and it lists all entries for advance tax, TDS, TCS, refunds and major transactions. If the TCS for your car purchase appears under the correct assessment year, it means the dealer has deposited the amount in your name.

“Form 26AS can view every TDS and TCS entry for the entire year. All 26AS records from 2009–10 to the present are available on the portal,” TaxBuddy founder Sujit Bangar told CNBC Awaaz. Form 26AS ensures that even if someone misplaces the car invoice, the tax record stays safe in the system.

Most people in India don’t know this…
but when you buy a new car in India the government actually owes you money back.

Yes, a refund. And it’s already linked to your PAN.

Whenever you buy a car above ₹10 lakh, the dealer collects 1% TCS.
So a ₹10L car → ₹10,000 TCS
A ₹30L…

— Ashish Kumar Meher (@AshishMeher7) November 28, 2025

Steps to Claim TCS In Your ITR

To claim the TCS, you need Form 27D and must match the details with Form 26AS. After that, you calculate your total tax for the year and file your ITR. The TCS amount will already show up in the “Taxes Paid” section.

If your tax due is lower than the total TDS plus TCS collected, you can claim a refund. If your tax due is higher, the TCS simply reduces the final amount you need to pay.

What Buyers Should Be Careful About

Sometimes taxpayers forget to cross-check their 26AS or do not claim the TCS at all. In other cases, dealers may delay depositing the amount or fail to enter the correct PAN.

If the TCS does not appear in 26AS, the buyer cannot claim it, so it is important to always collect Form 27D and verify the details.

The rule is meant for customers buying cars for personal use. It does not apply to dealers, manufacturers or companies buying vehicles for resale.